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Securities
 9 Months Ended
Sep. 30, 2023
Cash and Cash Equivalents [Abstract]  
Securities

Note 2 - Securities

Debt securities have been classified in the consolidated balance sheets according to management’s intent. The amortized cost, related gross unrealized gains and losses, allowance for credit losses and the fair value of available-for-sale securities are as follows (dollars in thousands):

 

 

 

September 30, 2023

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Estimated

 

 

 

Cost Basis

 

 

Holding Gains

 

 

Holding Losses

 

 

Fair Value

 

Securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

507,549

 

 

$

—

 

 

$

(22,102

)

 

$

485,447

 

Obligations of states and political subdivisions

 

 

1,726,947

 

 

 

120

 

 

 

(263,313

)

 

 

1,463,754

 

Residential mortgage-backed securities

 

 

2,792,813

 

 

 

—

 

 

 

(495,578

)

 

 

2,297,235

 

Commercial mortgage-backed securities

 

 

323,539

 

 

 

—

 

 

 

(18,191

)

 

 

305,348

 

Corporate bonds and other

 

 

112,338

 

 

 

—

 

 

 

(11,585

)

 

 

100,753

 

Total securities available-for-sale

 

$

5,463,186

 

 

$

120

 

 

$

(810,769

)

 

$

4,652,537

 

 

 

 

September 30, 2022

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Estimated

 

 

 

Cost Basis

 

 

Holding Gains

 

 

Holding Losses

 

 

Fair Value

 

Securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

504,457

 

 

$

2

 

 

$

(27,283

)

 

$

477,176

 

Obligations of states and political subdivisions

 

 

2,368,605

 

 

 

514

 

 

 

(285,307

)

 

 

2,083,812

 

Residential mortgage-backed securities

 

 

3,153,864

 

 

 

14

 

 

 

(456,997

)

 

 

2,696,881

 

Commercial mortgage-backed securities

 

 

406,530

 

 

 

1

 

 

 

(19,185

)

 

 

387,346

 

Corporate bonds and other

 

 

113,015

 

 

 

-

 

 

 

(12,787

)

 

 

100,228

 

Total securities available-for-sale

 

$

6,546,471

 

 

$

531

 

 

$

(801,559

)

 

$

5,745,443

 

 

 

 

December 31, 2022

 

 

 

 

 

 

Gross

 

 

Gross

 

 

 

 

 

 

Amortized

 

 

Unrealized

 

 

Unrealized

 

 

Estimated

 

 

 

Cost Basis

 

 

Holding Gains

 

 

Holding Losses

 

 

Fair Value

 

Securities available-for-sale:

 

 

 

 

 

 

 

 

 

 

 

 

U.S. Treasury securities

 

$

508,275

 

 

$

11

 

 

$

(25,737

)

 

$

482,549

 

Obligations of states and political subdivisions

 

 

2,104,193

 

 

 

1,217

 

 

 

(206,799

)

 

 

1,898,611

 

Residential mortgage-backed securities

 

 

3,034,120

 

 

 

8

 

 

 

(417,562

)

 

 

2,616,566

 

Commercial mortgage-backed securities

 

 

392,914

 

 

 

1

 

 

 

(18,046

)

 

 

374,869

 

Corporate bonds and other

 

 

112,846

 

 

 

-

 

 

 

(11,082

)

 

 

101,764

 

Total securities available-for-sale

 

$

6,152,348

 

 

$

1,237

 

 

$

(679,226

)

 

$

5,474,359

 

 

The Company did not hold any securities classified as held-to-maturity at September 30, 2023, September 30, 2022, or December 31, 2022.

The Company invests in mortgage-backed securities that have expected maturities that differ from their contractual maturities. These differences arise because borrowers may have the right to call or prepay obligations with or without a prepayment penalty. These securities include collateralized mortgage obligations (CMOs) and other asset backed securities. The expected maturities of these securities at September 30, 2023 and 2022, and December 31, 2022, were computed by using scheduled amortization of balances and historical prepayment rates.

The amortized cost and estimated fair value of available-for-sale securities at September 30, 2023, by contractual and expected maturity, are shown below (dollars in thousands):

 

 

 

Amortized

 

 

Estimated

 

 

 

Cost Basis

 

 

Fair Value

 

Due within one year

 

$

335,508

 

 

$

327,912

 

Due after one year through five years

 

 

1,345,049

 

 

 

1,214,288

 

Due after five years through ten years

 

 

2,466,782

 

 

 

2,034,867

 

Due after ten years

 

 

1,315,847

 

 

 

1,075,470

 

Total

 

$

5,463,186

 

 

$

4,652,537

 

 

 

The following tables disclose as of September 30, 2023 and 2022, and December 31, 2022, the Company’s investment securities that have been in a continuous unrealized-loss position for less than 12 months and for 12 or more months (dollars in thousands):

 

 

 

Less than 12 Months

 

 

12 Months or Longer

 

 

Total

 

September 30, 2023

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

U.S. Treasury securities

 

$

4,867

 

 

$

49

 

 

$

480,580

 

 

$

22,053

 

 

$

485,447

 

 

$

22,102

 

Obligations of states and political subdivisions

 

 

53,029

 

 

 

2,568

 

 

 

1,402,097

 

 

 

260,745

 

 

$

1,455,126

 

 

 

263,313

 

Residential mortgage-backed securities

 

 

3,123

 

 

 

106

 

 

 

2,294,112

 

 

 

495,472

 

 

$

2,297,235

 

 

 

495,578

 

Commercial mortgage-backed securities

 

 

1,274

 

 

 

87

 

 

 

304,074

 

 

 

18,104

 

 

$

305,348

 

 

 

18,191

 

Corporate bonds and other

 

 

—

 

 

 

—

 

 

 

100,753

 

 

 

11,585

 

 

$

100,753

 

 

 

11,585

 

Total

 

$

62,293

 

 

$

2,810

 

 

$

4,581,616

 

 

$

807,959

 

 

$

4,643,909

 

 

$

810,769

 

 

 

 

Less than 12 Months

 

 

12 Months or Longer

 

 

Total

 

September 30, 2022

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

U.S. Treasury securities

 

$

476,696

 

 

$

27,283

 

 

$

—

 

 

$

—

 

 

$

476,696

 

 

$

27,283

 

Obligations of states and political subdivisions

 

 

1,828,105

 

 

 

254,212

 

 

 

139,732

 

 

 

31,095

 

 

 

1,967,837

 

 

 

285,307

 

Residential mortgage-backed securities

 

 

1,507,121

 

 

 

231,915

 

 

 

1,187,815

 

 

 

225,082

 

 

 

2,694,936

 

 

 

456,997

 

Commercial mortgage-backed securities

 

 

386,479

 

 

 

19,185

 

 

 

—

 

 

 

—

 

 

 

386,479

 

 

 

19,185

 

Corporate bonds and other

 

 

59,782

 

 

 

4,544

 

 

 

40,446

 

 

 

8,243

 

 

 

100,228

 

 

 

12,787

 

Total

 

$

4,258,183

 

 

$

537,139

 

 

$

1,367,993

 

 

$

264,420

 

 

$

5,626,176

 

 

$

801,559

 

 

 

 

Less than 12 Months

 

 

12 Months or Longer

 

 

Total

 

December 31, 2022

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

 

Fair Value

 

 

Unrealized
Loss

 

U.S. Treasury securities

 

$

307,012

 

 

$

11,650

 

 

$

173,105

 

 

$

14,087

 

 

$

480,117

 

 

$

25,737

 

Obligations of states and political subdivisions

 

 

770,469

 

 

 

55,943

 

 

 

946,571

 

 

 

150,856

 

 

 

1,717,040

 

 

 

206,799

 

Residential mortgage-backed securities

 

 

470,970

 

 

 

37,065

 

 

 

2,143,869

 

 

 

380,497

 

 

 

2,614,839

 

 

 

417,562

 

Commercial mortgage-backed securities

 

 

319,303

 

 

 

11,677

 

 

 

54,862

 

 

 

6,369

 

 

 

374,165

 

 

 

18,046

 

Corporate bonds and other

 

 

41,920

 

 

 

1,698

 

 

 

59,844

 

 

 

9,384

 

 

 

101,764

 

 

 

11,082

 

Total

 

$

1,909,674

 

 

$

118,033

 

 

$

3,378,251

 

 

$

561,193

 

 

$

5,287,925

 

 

$

679,226

 

 

The number of investments in an unrealized loss position totaled 892 at September 30, 2023. We believe any unrealized losses in the U.S. treasury securities, obligations of state and political subdivisions, residential and commercial mortgage-backed and asset-backed investment securities, and corporate bonds and other at September 30, 2023 and 2022, and December 31, 2022, are due to changes in interest rates and not credit-related events. As such, no allowance for credit losses is required on these securities at September 30, 2023 and 2022, and December 31, 2022. Unrealized losses on investment securities are expected to recover over time as these securities approach maturity. Our mortgage related securities are backed by GNMA, FNMA and FHLMC or are collateralized by securities backed by these agencies. At September 30, 2023, 66.92% of our available-for-sale securities that are obligations of states and political subdivisions were issued within the State of Texas, of which 56.47% are guaranteed by the Texas Permanent School Fund.

Securities, carried at approximately $3,397,495,000 on September 30, 2023, were pledged as collateral for public or trust fund deposits, repurchase agreements, borrowings and for other purposes required or permitted by law.

During the three-months ended September 30, 2023 and 2022, sales of investment securities that were classified as available-for-sale were $113,132,000 and $17,081,000, respectively. Gross realized security gains from sales and calls during the third quarter of 2023 and 2022 totaled $53,000 and $334,000, respectively. Gross realized security losses from sales or calls during the third quarter of 2023 totaled $1,025,000. There were no gross realized security losses from sales or calls during the third quarter of 2022.

During the nine-months ended September 30, 2023 and 2022, sales of investment securities that were classified as available-for-sale were $320,419,000 and $205,444,000, respectively. Gross realized security gains from sales and calls during the nine-months ended September 30, 2023 and 2022 totaled $1,701,000 and $4,357,000, respectively. Gross realized security losses from sales or calls during the nine-months ended September 30, 2023 and 2022 totaled $2,615,000 and $2,344,000, respectively.

The specific identification method was used to determine cost in order to compute the realized gains and losses.